Federal Deficit now lowest in 4 yrs!

Discussion in 'Wall St. News' started by S2007S, Oct 11, 2006.

  1. S2007S



    By MARTIN CRUTSINGER, AP Economics Writer 42 minutes ago

    WASHINGTON - The federal budget deficit, helped by a gusher of tax revenues, fell to $247.7 billion in 2006, the smallest amount of red ink in four years.

    The deficit for the budget year that ended Sept. 30 was 22 percent lower than the $318.7 billion imbalance for 2005, handing
    President Bush an economic bragging point as Republicans go into the final four weeks of a battle for control of Congress.

    Both spending and tax revenues climbed to all-time highs. The sharp narrowing of the deficit reflected the fact that revenues climbed by 11.7 percent, outpacing the 7.3 percent increase in spending.

    The 2006 deficit was far lower than the $423 billion figure the administration had projected last February and also represented an improvement from a July revised estimate of $295.8 billion.

    It was the smallest deficit since a $159 billion imbalance in 2002, a shortfall that came after four straight years of budget surpluses, the longest stretch that the government had finished in seven decades.

    Since that time, the government has recorded three of the biggest deficits in history in dollar terms including an all-time record of $413 billion in 2004.

    The reason for the improvement this year was the big jump in revenues, propelled by strong economic strongth.

    The administration credits its tax cuts for the improving economy, contending they helped the nation withstand the 2001 recession, the terrorist attacks and a wave corporate accounting scandals.

    Democratic critics, however, contend that this year's improvement in the deficit will be only temporary. They contend the deficit is set to explode over the next decade as the baby boomers begin to retire and demands on
    Social Security and Medicare increase.
  2. Wow! Almost a surplus eh? only a quarter trillion to go.
  3. Daal


    these are also the same people who oppose any kind of solution for social security that doesnt involve taxing the united states more than any civilized country
  4. LT701


    too bad they dont include costs of the wars

    but that cant be very much
  5. piezoe


    these are also the same people who oppose any kind of solution for social security that doesnt involve taxing the united states more than any civilized country

    I suppose the question of social security really, at it core, boils down to one's personal philosophy, since to make the system fiscally sound would require only trivial changes compared to the very real and dire situation we find ourselves in with regard to medicare and medicaid.
  6. If it were not for Bush policies increasing the price of oil several fold...there would be no deficit...
  7. Arnie


    They're talking about a budget deficit, not a trade deficit.
  8. Yeah your right...no Iraq War no deficit...
  9. One data point does not a trend make.

    Here's a link to the national debt, which includes a cumulative annual deficits along with a host of other borrowing:


    Yep, that's in trillions.

    A forgone conclusion it'll never be repaid. The real quesiton is contending with compound interest and the continued ability to attract/retain foreign capital. A flat yield curve will eventually resolve.
  10. thats just like gm - made 400 million dollars this past quarter (cough cough - minus a 5 billion dollar loss due to restructuring). GO AMERICA!!!!!
    #10     Oct 11, 2006